Health Reform and Your Children

By Tammy Flanagan

September 17, 2010

The Affordable Care Act President Obama signed earlier this year includes provisions extending health care coverage for children on their parents' plans until they reach age 26. The Office of Personnel Management recently released guidance on how these provisions will be implemented under the Federal Employees Health Benefits Program and the government's flexible spending account program.

This is good news for many FEHBP participants (including me) who have adult children older than 22 who need health insurance. My youngest son decided after working for two years following high school that maybe a college education might not be a bad idea. So at 22 he's just finishing his sophomore year of college.

Here are some basic facts about the new provisions:

Married children are included (but not their spouses or their children).

The child does not have to live in your home.

The child does not have to be your dependent.

Children do not have to be students, or have prior or current insurance coverage to be eligible.

Stepchildren do not have to live with the enrollee in a parent-child relationship.

Foster children are eligible.

Children who are eligible for or have their own employer-provided health insurance still are eligible.

The new provisions will take effect on Jan. 1, 2011. Retirees who want to cover children younger than 26 will be permitted to take advantage of the opportunity in the same manner as current employees.

Making It Happen

If you already have self and family enrollment and do not change health plans during the upcoming open season, then your newly eligible children will be covered beginning Jan. 1. To get the coverage, though, you must contact your FEHBP plan to provide information on the newly eligible child or children. There is no specific form to fill out to do that.

The Office of Personnel Management has information online about FEHBP plan websites. Most of these websites have yet to post information on new coverage rules for children. I would suggest waiting until closer to health benefits open season, which starts in November, to contact your health plan.

If you have self-only enrollment and want coverage for a child, you'll have to enroll in a self and family plan by completing an SF 2809 Form, or by using your agency's self-service enrollment system during the upcoming open season. The change also can be made outside of open season under "qualifying life event" provisions.

For U.S. Postal Service employees, those under temporary continuation of coverage, former spouses and retirees, an enrollment or change in enrollment made either as a qualifying life event or as an open season change will provide coverage to eligible children on Jan. 1.

For most other federal employees, the open season change will take effect on Jan. 2. To make the change effective on Jan. 1, it must be completed as a qualifying life event change. Such changes can be made from 31 days before to 60 days after Jan. 1.

Temporary Continuation of Coverage

Your children will lose coverage when they turn 26, but then will be eligible for temporary continuation of coverage for up to 36 months. Children of FEHBP participants who currently are younger than 26 and are enrolled in TCC might no longer need this enrollment, since they will be covered under FEHBP in the near future.

To cancel TCC enrollment, you must contact the National Finance Center at:

One FEHBP plan, SAMBA, currently offers a separate health plan for dependent children through age 26. This plan will be discontinued on Jan. 1. Children who are younger than 26 will be transferred to the parents' self and family enrollment. SAMBA plans to send out notices to those with children enrolled in the dependent children's plan by Nov. 1 with the steps necessary to enroll them under their parents' self and family enrollment. Here's more information.

Other Changes

Following are some other changes in health benefits that will take effect on Jan. 1:

High-Deductible Health Plans: Over-the-counter medicines or drugs that currently are eligible for reimbursement from health savings accounts no longer will be eligible unless the enrollee has a prescription written by a physician. The only exception is insulin. Other currently eligible items that are not medicines or drugs will not require a prescription.

Flexible Spending Accounts: An employee enrolled in a flexible spending account can request reimbursement for eligible health care expenses incurred by a natural child, stepchild, adopted child, eligible foster child, or a child who is placed with the employee for legal adoption. The child does not have to reside with the employee, or qualify as the employee's tax dependent. Previously, eligible children were limited to those you could claim as a dependent on your tax return. The new law also has extended the age of children who might incur eligible expenses under your health care FSA. Expenses of an employee's child are covered through the taxable year prior to the taxable year in which the child turns age 27.

Tammy Flanagan is the senior benefits director for the National Institute of Transition Planning Inc., which conducts federal retirement planning workshops and seminars. She has spent 25 years helping federal employees take charge of their retirement by understanding their benefits.

For more retirement planning help, tune in to "For Your Benefit," presented by the National Institute of Transition Planning Inc. live on Monday mornings at 10 a.m. ET on federalnewsradio.com or on WFED AM 1500 in the Washington metro area.